Sales are one of the most Metric Driven team in any organization.
So what’s the difference between a Metric and a KPI?
The answer is simple, KPIs (Key Performance Indicators) are the Metrics that matter most because they correlate with business performance.
Here are 20 Sales KPIs that will help you sell more faster.
Chances are you know that like the back of your hand because you live it everyday – but why is it important to remind ourselves of the Sales funnel when thinking about Sales KPIs?
Well the Sales funnel is a process, and within this process there are roles to play. You will have prospectors, Sales reps, Sales managers and a strong possibility of forming a cross functioning team with the Marketing department that you would have aligned Objectives with.
KPIs, for the most part, is a tool for managers to monitor progress and can be used by Sales managers to motivate reps and make the Sales process better for both the customer and team. There are three layers to consider when looking into Sales team KPIs that revolve around the funnel.
On each layer we can measure a conversion rate as a percentage. The conversion rate from the initial request to becoming an opportunity is the Reach Rate %. The opportunity moving to a meaningful conversation is the Pas Rate%. This is converting from one stage to another. The rates count as KPIs for three reasons:
These Sales funnel KPIs tell a good story of what has already happened – the issue with these KPIs is that they are lagging metrics, not leading metrics. However these are important to keep an eye on regarding the Sales process.
The effective management of a Sales Pipeline requires the measurement of Sales KPIs because they will provide
the insight you need to be able to identify issues, diagnose causes, and predict future sales performance.
There are lots of Sales KPIs to choose from. Many of these can exist at the team and individual level.
Here is a list of Sales KPIs in Sales Funnel order. There are over 60 available in
ZOKRI that can be used in Dashboards and OKRs.
Your KPIs really are the metrics that matter most because they are often mostly connected to performance, either in a leading or lagging way.
Focusing your efforts on improving them and measuring them can only have one outcome – performance improvement.
Here are some KPIs for Sales teams that are designed to measure what matters.
Your entire business growth depends on the money you keep after covering your expenses – for this reason, this KPI is top of the list.
Think about the profit margin that you will be targeting. 5%, 10% or a high 20% – you can read more about this here.
Ultimately your target profit margin depends on the type of business you run and the industry you operate in.
Not strictly a Sales KPI, it’s a Marketing KPI, but Sales is not an island and not knowing about
and tracking MQLs stops you from predicting future shortfalls and using the KPI is calculations that
evaluate the quality of MQLs being generated like the MQL to SQL Conversion.
A common way to convert an MQL to an SQL is to have a Discovery call with the Prospect.
The % of MQLs that receive a completed Discovery Call is a good KPI to track as it allows you
to target and improve your ability to get prospects on a call, to understand their needs
more specifically, and kick-off the sales process.
Having a count of the number of Discovery Calls booked allows you to plan how many
you calls you need to allow your Sales Funnel to hit quotas.
Not all calls booked happen. Knowing the number of meetings that are booked and then happen
allows you to plan to improve number of completed meetings.
A sales-qualified lead (SQL) is a prospective customer that has been researched and
vetted — first by an organization’s marketing department and then by its sales
team – and is deemed ready for the next stage in the sales process.
The conversion % of MQLs becoming SQLs matters as a guide to the quality of MQLs being created,
and the effectiveness of the Sales team to convert an MQL into an SQL.
Tracking and having a goal for the average number of SQLs assigned to each Sales Rep during a
month allows you to plan and optimize the top of your funnel so you have optimal deal flow.
Based on the outcome of a Discovery Call you might sell a product that requires demonstration e.g. software.
The conversion % of SQLs to Demos Complete is a useful KPI as it allows you to set goals.
An Opportunity is neither a business, nor a person, but rather a potential future sale. An Opportunity
is something associated with Revenue and as such has a monetary value.
Growing the monetary value of the Opportunities in the Pipeline is a good KPI. You do need to be
careful that Opportunities are owned, kept accurate, and weighted.
The probability of closing an Opportunity can be applied to create a Weighted Value of the Sales Opportunities.
Again, this is a good Team and Individual KPI. Auditing how accurate estimates are and adjusting the
criteria for setting a weighting is important for this to consistent and trusted.
Tracking your ability to convert the Opportunities you have to Closed Won at the team and individual
level allows you to see who and how you can increase your conversion rates.
Having a count of number of Opportunities Closed Won is a good KPI,
especially when paired with Closed Won Value.
This is the business end of the funnel. This KPI tracks the value of Opportunities Closed Won.
This is another Team and Individual KPI.
Tracking the Average Contract Value as a KPI allows you to plan to increase it through goals.
The value of Opportunities Closed Lost is the flipside of the Closed Value coin.
Seeing the value of deals lost is always sobering and focuses the mind brilliantly.
Again, a simple count of the number of Opportunities Closed Lost.
The average number of days it takes an SQL to become a Closed Won sale is your Sales Cycle.
This KPI is normally expressed in days.
Sales Velocity measures how quickly you’re generating revenue. It captures the amount of time it takes to turn your
SQL into revenue and is expressed as Money Per Time Period.
Calculation: Sales velocity = (SQL Count * Deal Value * Conversion) / Sales cycle.
Having Sales Velocity as a Sales KPI so you can plan to reducing it via Goals and Initiatives
allows you to close more deals faster.
Ramped Reps are Reps with a Pipeline that is delivering a full Sales Quota. Having the optimal number of
Rampted Reps to hit Sales targets is essential but not as easy as it sounds. Ramping Reps not only requires training
and time, it requires other parts of the funnel to also scale, MQL and SQLs for example.
Of course you want 100% of Reps hitting their quota. Tracking what % are
actually making quota each month is a great Sales Leader KPI.
It’s understood that revenues don’t tell you as much about your company’s health as profit figures.
But the total amount of money you bring in to the company can help you complete certain analyses.
This KPI means that your sales team measure the amount of time, effort, and resources into seeking new leads.
Make sure to keep track of client calls, emails, meetings with prospects, demos and other Sales team activity around prospecting.
Your sales funnel must move customers smoothly from one step to the next. Remember the following:
Measure the amount of people who enter your sales funnel over a given period? Think about how this compares to
industry averages and your company’s previous performance?
How quickly does your sales team respond to new leads?
Think about how long it takes for a potential customer to wait to get an answer from your Sales team.
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If you want to improve KPIs, creating KPI Dashboards is the natural next step.
These KPIs can and should also be used inside Key Results as part of setting goals using OKRs.
Remember that when setting your targets to be ambitious. Goals are deliberately designed to be hard to achieve,
as this is what drives greater creativity, efficiency and effectiveness.
The data can be gathered from integrations with Salesforce and other Sales and
Marketing technologies you’re using, or update KPIs manually.
Inside ZOKRI you can create Dashboards and create OKRs from KPIs. You can also create and manage Initiatives
targeting these KPIs and OKRs in ZOKRI or by connecting task managers like Trello and Asana.
It’s FREE to create an account on ZOKRI – click here to find out more.
Measuring KPIs that matters, setting goals and aligning and optimizing your operations is
the key to performance growth and is what ZOKRI is designed to do.